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Towers Watson: Big Pension Plans Did Better In 2009

By Staff Writer

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Rising stock prices helped defined benefit pension plans at large, public U.S. companies increase their “funded ratios” in 2009, analysts say.

The analysts, at Towers Watson & Company, New York (NYSE:TW), looked at results for the 100 largest U.S. companies that sponsor defined benefit pension plans.

Stock market gains and cash contributions caused plan assets to increase 12% between 2008 and 2009, to $863 billion.

The plans’ total funding deficit shrank to about $183 billion, from about $210 billion at the end of 2008, and the overall total funding ratio increased to 82%.

The average funding ratio was down from close to 100% in 2007, but up from 78% at the end of 2008.

But the average plan discount rate fell to 5.92%, down from 6.38% in 2008 and down from 6.29% in 2007.